Australian aid cuts may hit Asia-Pacific development

Australian aid will see further decline in the next four years, affecting education and health programmes in recipient countries in the long term.

The Australian flag as seen from Darling Harbour, Sydney, amid cranes used for high-rise construction. As Australia cuts foreign aid, its recipients in Asia-Pacific will get hit in the long term. Image: Pauline SALLET, CC BY-NC-ND 2.0

By Neena Bhandari, SciDev.net

Thursday 25 May 2017

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The development sector in some of the Asia-Pacific countries may take a hit as Australia’s Official Development Assistance (ODA) is forecast to decline further in real terms in the next four years continuing its sweeping foreign aid cuts in recent years.

Aid budget for 2017–2018 stands at US$2.90 billion, down from its peak of US$3.87 billion in 2012–2013. Aid will slightly rise in 2018–2019 to US$2.98 billion but it will then be frozen for the next two years, a decline of 3.4 per cent in real terms. The move is said to be in line with the Consumer Price Index and to help fund “other policy priorities”.

“There is an understanding that the aid budget is frozen until the federal government budget returns to surplus, which isn’t a good forecast for people who rely on Australia’s international assistance,” says Annmaree O’Keeffe, a non-resident fellow at the Lowy Institute for International Policy, Sydney.

Robin Davies, associate director at Australian National University’s Development Policy Centre says those priorities may be security-related.

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There is an understanding that the aid budget is frozen until the federal government budget returns to surplus, which isn’t a good forecast for people who rely on Australia’s internatioanl assistance.

Annmaree O’Keeffe, Lowy Institute for International Policy

“We know the savings are to be retained in the foreign affairs portfolio, which includes the Australian Secret Intelligence Service.

Also, the government’s apparent determination to draw a connection between the cuts announced in this year’s aid budget and the expansion of Australia’s national security apparatus does send a message—that the objectives of Australia’s aid programme are increasingly bound up with our national interests, particularly our security interests,” Davies says.

Australian Council for International Development (ACFID)’s chief executive officer Marc Purcell says, “Diverting aid to intelligence agencies and military hardware is a short-term approach and fails to recognise the value of education, health and governance programmes which tackle the root causes of poverty, inequality and instability over the long-term.”

“Many bilateral aid programmes to Asia have been cut by over 40 per cent and there have been complete withdrawals from some sectors such as regional health programmes in South-East Asia. There has been a lack of strategic vision in Asia so clearly demonstrated by Australia’s reduction in assistance to Myanmar as a fledgling democracy and transitioning economy.

We also remain extremely concerned that the most vulnerable people living on Pacific island nations are inadequately protected from climate change,” Purcell tells SciDev.Net.

Australian aid was at a historic low 0.25 per cent of the Gross National Income (GNI) in 2016, putting the country at number 17 amongst OECD countries in the measure of aid generosity as a proportion of GNI.

While Australians are generous contributors to non-government organisations, they rarely think about government aid.

“The general population of Australia is pretty uninformed about international aid programmes and what it does in terms of contributing to a better world,” says O’Keeffe.

“Unfortunately, Australians do not have a full understanding of the way in which international development actually supports Australia’s national interest by supporting the development of the partner countries it is working with,” she adds.

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